Vancouver — An exploration alliance between nickel giant
Blackstone has secured rights to explore seven district-scale projects, including several properties explored by Falco in the 1970s. Others were selected during more recent generative programs focused on the quest for “Voisey’s Bay-type” targets hosted in similar geological and structural terrain.
Blackstone president Donald McInnes says Norway represents a prime hunting ground for nickel that will be needed in future decades to meet growing demand from China, India, and other emerging economies. He notes that earlier this year, China surpassed Japan for the first time as the world’s largest nickel consumer, with an estimated 16% of global demand, compared with just 6% in 1994.
“We’ve seen a 26% annual growth rate since 2000,” McInnes says, adding that he expects demand to outstrip supply for years to come. “That’s why some analysts are describing nickel as ‘the new oil.'”
The partners began their joint exploration effort in 2003, when Blackstone optioned the Espedalen and Vakkerlien properties from Falco. In September of this year, the partners expanded their holdings by adding five district-scale, nickel-copper-cobalt project areas collectively called the South Norway option. The combined land package now encompasses 30,000 sq. km, and covers 52 past-producing (from 1849 to 1945) mines and numerous nickel and nickel-copper occurrences that have never been tested with modern exploration methods.
Blackstone also beefed up its team by adding former senior Falco executive Michael Knuckey to its board, and geologists Richard Moore and Dean MacEachern as technical advisors.
“Falco has been looking for a new nickel camp for some time,” MacEachern says, adding that there aren’t a lot of them to be found in the world. “They see potential here.”
MacEachern notes that Norway is the historic birthplace of nickel, which got its name in the 1880s, when it was called cuppernickel (copper devil) because it complicated the recovery of the desired metal, copper.
Numerous small nickel mines operated in the late 1800s and early 1900s, but activity withered and eventually ceased once the Sudbury camp came to prominence in Canada. As a result, no modern geophysical surveys and very little exploration have taken place in Norway since Sudbury was developed.
The discovery of Voisey’s Bay changed all that, MacEachern notes.
Norway and Greenland share geological and structural similarities with Newfoundland and Labrador. The mid-Proterozoic North Shield area (encompassing these modern-day geographic regions) contains anorthosite complexes considered prospective for nickel-copper-cobalt deposits similar to Voisey’s Bay in both Labrador and Norway.
MacEachern says the properties have “potential for a significant discovery in less than one year,” and adds that some targets have returned grades of more than 6% nickel from grab samples. “It’s unusual to see grades that high.”
Earlier this spring, Falconbridge ranked the joint venture’s Espedalen project in Norway as second on its list of top exploration projects, behind the new Fraser Morgan nickel discovery in Sudbury. The major is spending almost $5 million to earn back a 60% interest in the project.
Espedalen has been actively explored for the past two years, resulting in a new discovery called Stormyra. The discovery returned 6.91% nickel and 2.05% copper over 1.9 metres, and 1.73% nickel, 0.77% copper and 0.06% cobalt over 14.6 metres.
Stormya has a preliminary resource of 251,000 tonnes of 2.94 nickel-equivalent, which does not yet meet National Instrument (NI) 43-101 reporting standards. Highlights from this year’s drilling program include 2.81% nickel, 1.11% copper and 0.08% cobalt over 10.17 metres.
Espedalen has numerous other targets, including several tested in the 2005 drill program. Highlights include: 1.05% nickel over 7.2 metres (the Vesle target), 1.73% nickel over 1.53 metres (Trona), 0.96% nickel over 6.4 metres and 2.48% nickel over 0.9 metre (Storgruva Ext.).
At the Vakkerlien project in southern Norway, Blackstone holds an option to earn 60% by spending $2.25 million by 2008. The project was explored in the 1970s by a Falco subsidiary that identified a deposit hosting about 400,000 tonnes grading 1% nickel and 0.4% copper (this historic estimate is not NI 43-101-compliant). The goal now is to find a larger and higher-grade massive sulphide deposit. Toward that end, ground geophysical surveys are being carried out over two large magnetic features along strike of the Vakkerlien deposit identified by recent airborne EM and magnetic surveys. The targets will be tested by drilling early next year.
The newly acquired South Norway projects — Hosanger, Evje, Bamble, Ertelien, and Skjakerdalen — have never been drill-tested or surveyed using modern geophysics. The land package covers 35 past-producing mines, including the Ertelien mine that produced an estimated 400,000 tonnes grading 1.04% nickel, 0.69% copper, and 0.17% cobalt, and Langdalen, which produced 250,000 tonnes grading between 2.5% and 3.5% nickel.
Blackstone can earn 50% of the South Norway properties by spending US$18 million by 2012. McInnis says that while Norway has high environmental standards, it also has a “good, no-nonsense approach to resource development.” Another advantage, he adds, is that Falco has operated the Nickkelwerk refinery at Kristianand for decades, and the company has an excellent operating history in the nation.
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